Maker Explores Rebranding Options After Recent Transition

Overview of the Situation

Maker is contemplating a potential rebranding strategy just two months after its transition to the name "Sky." Initially announced in late August and implemented on September 24, the rebrand aimed to facilitate the conversion of the original MKR governance token to the new SKY governance token at a rate of 1-to-24,000.

Conversion Rates and Market Performance

Since the rebranding, only 10.7% of MKR token holders have made the switch to the SKY governance token. In contrast, the USDS stablecoin has experienced a more favorable reception, achieving a market cap of $1.26 billion.

Community Sentiment and Governance Options

Rune Christensen, co-founder of Maker, highlighted the community's strong attachment to the Maker brand, noting that many holders prefer to retain their MKR tokens rather than upgrade to SKY. On October 28, the Maker team will present three options for governance votes:

1. Maintain "Sky" as the core brand.
2. Completely revert to the original Maker brand identity.
3. Revert to the original branding with minor updates to align with USDS and StarDAOs.

Psychological Factors in Token Value

The redenomination from MKR to SKY was intended to leverage "unit bias," where a lower price per token might attract more retail investors. However, Christensen admitted that this strategy did not yield the expected results, particularly as the SKY token failed to be listed on centralized exchanges.

Incentives and Criticism

To encourage conversion to SKY, incentives such as "seal rewards" and "activation rewards" were proposed for stakers. However, Christensen acknowledged that these features have become complicated amid numerous new developments based on community feedback. Critics have pointed out the significant expenditure of $50 million on the rebranding, to which Christensen responded that the funds were not solely for rebranding but aimed at boosting demand for the USDS stablecoin.

Future Developments

Since the rebranding to Sky, the Maker team has launched several high-profile initiatives, including the integration of USDS with Aave and the introduction of USDS to Solana and other Ethereum Layer 2 solutions.